‘Price pressures have meanwhile risen to a two-and-a-half year high, which is likely to feed through to final prices paid for goods consumers in coming months.’ – Chris Williamson, IHS Markit
The Purchasing Managers’ Index for the US manufacturing sector grew less than analysts estimated. According to the Institute for Supply Management, the PMI lost 2.4% compared to the previous month and tumbled to 54.8%, while experts anticipated only a slight decrease of 0.6%. Although in April the PMI rose at the slowest pace this year so far, it still remained above the 12-month average of 53.6%. The ISM report showed that the New Orders, Employment and Supplier Deliveries Indices dropped 7.0%, 6.9% and 0.8%, accordingly. Meanwhile, both Inventories and Prices Indices posted a 2% advance, which indicated that manufacturing companies stockpiled more raw materials than in the previous month and their costs increased. Nevertheless, all 18 manufacturing industries, excluding the apparel, leather and allied products industry, reported growth in April. In addition, all 15 commodities included in the report rose in price. Rising prices confirmed the view that inflation growth remained solid. Overall, all Indices remained above the 50% threshold and, thus, confirmed the general, long-term upward trend. Even though GDP figures released on Friday last week missed forecasts, analysts suggest that the US economy will likely regain momentum in the upcoming quarters.
